Nation & World

TV ads continue to slump: Money flows to Google and Facebook

A
A "lighthouse" constructed of Bud Light beer cans is the perfect party house in this Bud Light commercial. (St. Louis Post-Dispatch/TNS)

Facebook’s woes won’t help revive television advertising that is expected to decline in 2018 for the second straight year, research firm eMarketer said in a recent report.

EMarketer doesn’t expect TV advertising to rebound until 2020 — and then only slightly by 0.5 percent — because of the NBC-broadcast Tokyo Summer Olympics and the presidential election.

Television advertising has been battered by the popularity of the ad-free streaming service Netflix — which has led to declines in Nielsen ratings for broadcast-TV and cable-TV ratings — and increased in targeted ads on social media and digital platforms such as Google and Facebook.

Even streaming device Roku now sells ads, adding more competition for legacy television networks.

Comcast’s NBCUniversal and Fox have said they would cut their advertising load, or the number of advertisements during dramas and entertainment shows, as viewers expect a more enjoyable viewing experience — one not cluttered by a parade of ads.

Comcast also has launched an advanced advertising group in New York to target television ads to audiences.

“The ad dollars follow the audience and the TV audience is declining. I don’t think there is a reason to sugarcoat this,” Paul Verna, principal analyst for video at eMarketer, said in a recent interview.

“I don’t think you are looking at a dying industry. We are looking at a shift.”

According to eMarketer, television advertising fell 1.5 percent in 2017 to $70.2 billion and will drop 0.5 percent this year, in addition to a 1 percent decline in 2019.

ARTICLE CONTINUES BELOW ADVERTISEMENT

Facebook has come under attack for allowing the unauthorized use of personal data to target political ads during the 2016 election. Federal lawmakers could regulate some areas of digital privacy and big tech-company stocks have taken a beating, in part over concern about data-mining and whether government would impose regulations.

But eMarketer doesn’t believe the scandal will change the broader dynamic of media ads growing on digital platforms.

Comcast has merged into one office, in New York, its ad-technology companies Strata, Visible World and FreeWheel. The idea is, “How do we bring TV to where digital is?” a Comcast spokesman said.

Comcast noted in its recent annual report advertising revenue decreased in 2017 because of the “impact of continued declines in audience ratings at our networks.” Those advertising declines were partly offset by higher ad prices at NBC, the company said.

EMarketer projects that digital platforms — Google, Facebook, and others — accounted for 43.6 percent of total media ad spending in 2016.

That’s expected to grow to 56.8 percent by 2020 and 62.1 percent by 2022.

Give us feedback

We value your trust and work hard to provide fair, accurate coverage. If you have found an error or omission in our reporting, tell us here.

Or if you have a story idea we should look into? Tell us here.

CONTINUE READING

MORE Nation & World ARTICLES TO READ NEXT ...

An island-wide blackout has struck Puerto Rico, plunging the U.S. territory of more than 3 million citizens back into darkness more than seven months after local and federal officials began working to restore a fragile power grid ...

Kristin Barnaby, a self-described arachnophobe, found a way to overcome what she dreads at a North Carolina burger joint.'I am going to eat my fear,' the 27-year-old said at the Bull City Burger and Brewery, where she tucked in to ...

Give us feedback

We value your trust and work hard to provide fair, accurate coverage. If you have found an error or omission in our reporting, tell us here.

Or if you have a story idea we should look into? Tell us here.